E-Human Resources Manageme

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e-Human Resources

Management:Managing Knowledge People

Teresa Torres-Coronas

Universitat Rovira i Virgili, Spain

Mario Arias-Oliva

Universitat Rovira Virgili, Spain

Hershey • London • Melbourne • Singapore

IDEA GROUP PUBLISHING


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Library of Congress Cataloging-in-Publication Data

e-Human resources management : managing knowledge people / Teresa Torres-Coronas,

Mario Arias-Oliva, editors.

p. cm.

Includes bibliographical references and index.

ISBN 1-59140-435-5 (h/c) -- ISBN 1-59140-436-3 (s/c) -- ISBN 1-59140-437-1 (eISBN)

1. Personnel management. 2. Information technology--Management. 3. Knowledge

management. I. Torres-Coronas, Teresa, 1966- II. Arias-Oliva, Mario, 1968-

HF5549.E14 2005658.3'00285'4678--dc22

2004016385

British Cataloguing in Publication Data

A Cataloguing in Publication record for this book is available from the British Library.

All work contributed to this book is new, previously-unpublished material. The views expressed in

this book are those of the authors, but not necessarily of the publisher.


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As we were writing this preface, Madrid went through one of the

worst days in its history. This is why we want to dedicate thisbook to the memory of those who are no longer with us, to the

memory of those who lost their lives in the bomb attack on a train

in Madrid on March 11, 2004. They were going to work, struggling

to balance work and life; they were part of our human capital;

they were inimitable, irreplaceable, and very special assets…they

should be here.

Dedication


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E-Human Resources

Management:

Managing Knowledge People

Table of Contents

Preface ................................................................................................. vii

SECTION I: THE CUTTING-EDGE IN HRM

Chapter I.

Web-Based Organizing in Traditional Brick-and-Mortar Companies:

The Impact on HR ................................................................................. 1

Jaap Paauwe, Erasmus University Rotterdam, The Netherlands

Elaine Farndale, Erasmus University Rotterdam, The Netherlands

Roger Williams, Erasmus University Rotterdam, The Netherlands

Chapter II.

Integrating Handheld Computer Technology into HR Research andPractice ................................................................................................. 31

Scott A. Davies, Hogan Assessment Systems, USA

Robert F. Calderón, Caliber Associates, Inc., USA

Chapter III.

Social Network Mapping Software: New Frontiers in HRM ............ 68

Mousumi Bhattacharya, Fairfield University, USA

Christopher Huntley, Fairfield University, USA


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SECTION II: R EDESIGNING HR ADMINISTRATIVE PROCESSES

Chapter IV.E-Recruiting: Categories and Analysis of Fortune 100 Career

Web Sites ............................................................................................. 86

In Lee, Western Illinois University, USA

Chapter V.

Employee Self-Service HR Portal Case Study: Access, Content,

& Application ..................................................................................... 101

Andrew Stein, Victoria University, Australia

Paul Hawking, Victoria University, Australia

Chapter VI.

Human Resource Portals and the Protean Career: A Three-Factor

Model ................................................................................................. 122

Constant D. Beugré, Delaware State University, USA

SECTION III: E-LEARNING STRATEGIES

Chapter VII.

Keeping Up with the Corporate University: Resources for HRMFaculty and Practitioners................................................................... 144

Pamela D. Sherer, Providence College, USA

Timothy Shea, University of Massachusetts Dartmouth, USA

Chapter VIII.

E-Learning Strategies of Italian Companies .................................... 171

Anna Comacchio, University of Ca’ Foscari, Italy

Annachiara Scapolan, University of Ca’ Foscari, Italy

SECTION IV: MANAGING IT AND ORGANIZATIONAL CHANGES

Chapter IX.

Is Organizational e-Democracy Inevitable? The Impact of

Information Technologies on Communication Effectiveness .......... 206

Bernadette M. Watson, University of Queensland, Australia

Gavin M. Schwarz, University of New South Wales, Australia

Elizabeth Jones, Griffith University, Australia


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Chapter X.

Managing and Practicing OD in an IT Environment: A Structured

Approach to Developing IT Project Teams ...................................... 236 Joseph Logan, AstraZeneca Pharmaceuticals, USA

About the Authors .............................................................................. 269

Index................................................................................................... 276


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Preface

vii

Aim of This Book

In 1998, a highly innovative film, Antz , directed by Eric Darnell and Tim Johnson,

was released. In the first scene of the movie, Ant Z 4195 is talking to his

psychoanalyst and saying:

“…and my job, don’t get me started on, cause it really annoys me…I feel

physically inadequate, I, I, my whole life I’ve never been able to lift 10

times my own body weight and when you get down to it, handling dirt

is…yuck, you know is not my idea of a rewarding career. It’s this whole gung-ho super-organism thing that I, I, you know I can’t get, I try but I

can’t get it. I mean you know, what is it, I’m supposed to do everything

for the colony, and what about my needs, what about me? I mean I gotta

believe there’s someplace out there that’s better than this! Otherwise I’d

just curl up in a larva position and weep! The whole system out there just

makes me feel...insignificant!”

Z 4195 is striving to reconcile his own individuality with the communal work

of the ant colony. Our unhappy and depressed ant is working for a traditionalhierarchical organization, where people are not treated as valuable assets and

IT systems are not yet implemented. Even worse, he is currently working for

an organization that may have neither examined people management prac-

tices, nor made a real connection between people and organizational perfor-

mance. While this behavior is still prevalent in many of today’s companies, we

are presenting a book about e-HRM, about how IT is changing traditional

HRM functions, about how e-HRM practices are implemented. Could this be

a paradox? We hope so, because as Junipier (1996) pointed out: “Paradox is


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viii

an excellent creativity facilitator; it delivers a seismic jolt to dominant ideas,

themselves the most efficient suppressor of original thinking” (p. 19). We need

creative facilitators to develop the new e-HRM landscape.The above presents one of our oldest concerns about managing people: Most

organizations are far from considering people as their most important asset.

They are also far from applying common sense practices such as those to be

found in Pfeffer’s book, The Human Equation (Harvard Business School

Press, 1996). These organizations are now entering the knowledge era, using

IT solutions to solve their old HRM problems in one out of 10 cases, and in an

uncreative way. Those in the world of HRM are being accused of living in an

ivory tower, managing the human side of their organizations in ways that lack

relevance in the new information era. The impetus for the HRM change comes

from recognition of recent developments in the HRM profession and a real-ization that current practices do not reflect those changes, especially those

concerning IT strategies. The problem often results in policies, practices, and

strategies that may be outdated.

Organizations are progressively incorporating ITCs into their processes, using

different tools and solutions. These tools are applied in a wide variety of ways

(i.e., manufacturing resource planning, office automation, computer-supported

cooperative work, distributed teams, supply chain, enterprise-wide resource

planning, or virtual integration). The entry into service of the first high-capac-

ity transatlantic cable in 1956 and the launch of Sputnik in 1957 marked the beginnings of the era of global information exchange. In 1956, for the first

time in history, the number of white-collar workers exceeded that of blue-

collar workers (Naisbitt, 1984).

The factor we would stress in this growth in TICs is not the increase in the

amount, capacity, or inter-connectivity of technology in organizations. The

strategic key lies in the organization’s ability to integrate these technologies

into their current business processes, and also in their ability to reorganize the

said processes (Orlikowski, 1999, p. 3). And this is what this book is all

about.

Content of This Book

e-HRM: Managing Knowledge People responds to the challenge of docu-

menting recognizable, innovative, and creative approaches to e-HRM. Its aim

is to define and carry forward the debate in a complex and versatile matter.


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ix

Future research will continue the process of clarifying and documenting the

evolution of e-HRM. In the meantime, however, human resources manage-

ment researchers, faculty, practitioners, and consultants may find the ideasand experiences offered in this book genuinely helpful and illuminating.

This book is presented in four sections — the first intended to be more gen-

eral in nature, the following three devoted to specific aspects of the HRM field

in the new information era. Section I, The Cutting-Edge in HRM, presents an

overview of how ITCs are modifying general HRM processes and functions.

This is the aim of the first three contributions.

In the first chapter, Web-Based Organizing in Traditional Brick-and-Mor-

tar Companies: The Impact on HR, Jaap Paauwe, Elaine Farndale, and

Roger Williams, based mostly on their personal experience, focus on how old

economy organizations are developing new business models. These models

are changing both customers’ and suppliers’ relationships with the organiza-

tion and, of course, e-commerce strategy as a whole. With these new models

being implemented, the potential implications for HRM need to be explored.

The effects of Web-based organizing in HRM, including workers’ selection,

training and development, learning, trust-building within an organization, and

knowledge sharing, among others, are discussed. One relevant conclusion of

their analysis is that “internal improvements, necessary for the successful trans-

ference of business to the Internet, will enable the HR function to justify its

existence in financial terms.”Scott A. Davis and Robert F. Calderón, in their chapter Integrating Handheld

Computer Technology into HR Research and Practice, present potential

applications of handheld computers for HR practice and research. They an-

ticipate major improvements and widespread implementation of wireless net-

works with resulting implications for worker mobility, availability, and com-

munication. These factors will impact work planning, schedules, conducting

meetings, organizational data sharing, and an optimum balance between work

and life. Their model, which integrates empirical research and practical

knowledge, will be useful for those researchers and practitioners eager

to explore handheld computer technology applied to strategic HR plan-ning and management.

Mousumi Bhattacharya and Christopher L. Huntley’s chapter, Social Net-

work Mapping Software: New Frontiers in HRM, discuss the connections

between social network mapping software and the effectiveness of HRM pro-

grams. Their study is based upon research into social networks and the ef-

fects of these networks on both business processes and HRM. The authors

clearly show the uses of information on social networks in HRM processes


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x

and what information is generated by social network mapping software (SNMS).

They classify the functionality offered by SNMS in the categories of data

collection, descriptive modeling, and decision support. They also discuss howeach of these functions provides information relevant to different HRM func-

tions.

Section II, Redesigning HR Administrative Processes, explains how some

HRM functions, such as e-recruitment and developing appropriate systems

for employee relationships, are being implemented in the knowledge era.

As hiring qualified employees is a critical organizational decision in the knowl-

edge-based economy, In Lee, in his chapter E-Recruiting: Categories and

Analysis of Fortune 100 Career Web Sites, analyzes the corporate career

Web sites of the Fortune 100 companies. He identifies 33 attributes that char-

acterize corporate career Web sites and groups them into four major areas:

recruiting methods, job search tools, job application tools, and information on

organizational attributes. Knowing how other organizations are using Web

sites to recruit their human capital is a first step towards finding breakthrough

ideas for one’s own organization.

In the next chapter, Employee Self-Service HR Portal Case Study: Access,

Content, & Application, Andrew Stein and Paul Hawking examine the de-

velopment of the human resources (HR) ESS portal. Without any doubt, the

added value in this chapter consists of the case studies of three Australian

organizations that have implemented an ESS portal. The authors show theinformation and process focus of these organizations’ ESS portals, which are

used to place the organizations into Brosche’s (2002) portal development

model.

Focusing on the development of human resources, Constant D. Beugré’s chap-

ter, Human Resource Portals and the Protean Career: A Three-Factor

Model , develops a three-point model (individual attributes, characteristics of

the human resource portals, and organizational factors) to describe the fac-

tors in the effective use of Web-based human resource services. On the basis

of this model, he argues that the effective use of Web-based human resource

services plays an important role in the management of the protean career.

As organizations have started to recognize e-learning as having the power to

transform the performance, knowledge, and skills landscape (Gunasekaran,

McNeil, & Shaul, 2002, p. 44), Section III, E-Learning Strategies, concen-

trates on the e-training and e-learning world.

Pamela D. Sherer and Timothy Shea, in their chapter Keeping Up with the

Corporate University: Resources for HRM Faculty and Practitioners, dis-


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xi

cuss the major factors that influence the growth and role of the corporate

university within organizations: in terms of strategy and human resources,

knowledge management, and technology and e-learning. They also include intheir chapter an annotated compendium of key resources in each of these

areas, especially Internet resources. These resources are a good starting point

to begin digging deeper into this rapidly changing subject.

E-Learning Strategies of Italian Companies, a chapter by Anna Comacchio

and Annachiara Scapolan, is devoted to the empirical study of country-spe-

cific e-learning models, focusing on the e-learning experience of Italian com-

panies in the pharmaceutical and banking industries. How are companies imple-

menting e-learning? How are they analyzing the most important features of the

e-learning strategies: users, contents, infrastructure, and service and support?

The two cases presented will help the reader to answer these questions.

Section IV, Managing IT and Organizational Changes, discusses the pro-

cesses for achieving success when implementing IT solutions within organiza-

tions.

In the chapter, Is Organizational e-Democracy Inevitable? The Impact of

Information Technologies on Communication Effectiveness, Bernadette

M. Watson, Gavin M. Schwarz, and Elizabeth Jones consider the relation-

ships between social identity and e-democracy. They also discuss the inevita-

bility of organizational e-democracy in organizations pursuing information tech-

nology changes. They investigate perceptions of changes in effective commu-nication during the implementation of organizational change in a hospital. Their

findings are discussed in terms of the implications that arise for HR practitio-

ners.

Finally, Joseph Logan, in his chapter Managing and Practicing OD in an IT

Environment: A Structured Approach to Developing IT Project Teams ,

outlines a framework for improving success in IT projects by leveraging the

organization development (OD) practitioner’s expertise in fostering coopera-

tion and learning in teams. In the author’s opinion, failures in IT projects are

caused by a lack of integration of OD and IT.

In summary, this book’s content sets out to highlight the trends in theory and

practice which are likely to influence human resource management practices

in the IT era, to examine innovative e-HR strategies from a variety of empiri-

cal and theory-based perspectives, to provide insightful analysis, and to pro-

mote the discovery and dissemination of innovative theories and best prac-

tices. But there are important strategic HRM issues missing, such as, for ex-

ample: e-work and teleworking, the development of new industrial relations


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xii

models, managing the e-workforce in multinational organizations, e-ethics, or

managing values and IT. Of course, some critical reflections on competencies

and abilities should have been considered (i.e., IT competencies for an HR manager, e-leadership and e-team skills, e-facilitation and e-coaching, e-trust,

or e-creativity — developing skills of creative application of IT on organiza-

tions). So, there is still a lot work to do!

The Book’s Audience

e-HRM: Managing Knowledge People presents insights gained by leading

professionals from the practice, research, and consulting side of the e-HRMfield. This book should be useful to a variety of constituencies who are inter-

ested in the interrelationships between human resources management and IT,

including managers who treat their personnel as a key factor for organizational

success, leaders wishing to develop the human side of their organizations, IT

experts, human resources managers, researchers, consultants, and practitio-

ners. Each audience may have different levels of interest in the theoretical

concepts, practical experiences, and empirical data presented in this book.

As we are exploring an evolving discipline, we assume that any of these read-

ers will begin, but not complete, an exploration of the e-HRM new world.

Enjoy the reading and enjoy the learning!

References

Brosche, C. (2002). Designing the corporate portal. Masters Thesis, De-

partment of Computer Science, University of Gothenburg, Sweden.

Gunasekaran, A., McNeil, R.D., & Shaul, D. (2002). E-learning: Research

and applications. Industrial and Commercial Training , 34(2), 44-53.

Junipier, D. (1996). Human resource and creativity. Work Study, 45(7), 15-

22.

Naisbitt (1984). Megatrends . New York: Warner Bros.

Orlikowski, W. (1999). The truth is not out there: An enacted view of the

digital economy. Understanding the digital economy — Data, tools,

and research. Washington, DC: U.S. Department of Commerce.


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xiii

With gratitude, love, and respect we thank…

Our publisher, Idea Group Inc., who supported this project and, of course,

Jennifer Sundstrom, for her great job during the complex work of editing this

book. Both our contributors and reviewers. The contents of this book were

made possible because of contributors and the generous cooperation and valu-

able suggestions given by the reviewers. We are indebted to them for sharing

their knowledge with us. All those working to expand and enhance scientific

knowledge in the field of human resources management and IT, and who have

contributed — and continue to do so — to the development of guidelines toachieve more efficient, effective management.

And last but not least:

To my beloved husband Jordi and my charming sons Arnau and Jordi,

who have made my life a fascinating journey. (Teresa’s special thanks)

To my wife, Mar, who has always supported me. (Mario’s special thanks)

Teresa Torres-Coronas & Mario Arias-Oliva

March 11, 2004


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Section I

The Cutting-Edge

in HRM


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Web-Based Organizing in Traditional Brick-and-Mortar Companies 1

Copyright © 2005, Idea Group Inc. Copying or distributing in print or electronic forms without written

permission of Idea Group Inc. is prohibited.

Chapter I

Web-Based Organizing

in Traditional

Brick-and-MortarCompanies:

The Impact on HR

Jaap Paauwe, Erasmus University Rotterdam, The Netherlands

Elaine Farndale, Erasmus University Rotterdam, The Netherlands

Roger Williams, Erasmus University Rotterdam, The Netherlands

Abstract

This chapter introduces the notion of how old-economy brick-and-mortar

firms are adapting their HRM policies and practices and the roles of their

HR departments in light of newly introduced Web-based business-to-

business transaction practices. It argues that the Internet has introduced

three new business models in old-economy companies: the Internet as a

marketplace, the Internet as a supply chain integrator, and the Internet as


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2 Paauwe, Farndale, & Williams



a catalyst for business model redefinition. These innovative ways of

organizing are providing HR with opportunities to rise to new challenges

and increase their added value to the firm.

Introduction

The so-called new economy has taken a beating over the past few years. The

dot.coms have come — and many have gone again. Even the last great hope

of the new revolutionary age, Enron, filed for bankruptcy. However, the

phenomenon known as the Internet is not going to go away; it just keeps

expanding. Slowly but surely more and more individuals and companies arecoming to rely on it for doing business. Maybe the changes will be more gradual

than originally predicted. But the changes are happening. The purpose of this

chapter is to look at some of the possible consequences of these current

developments for HR.

The Internet can, of course, be used for different purposes. Through the use of

e-mail and similar derivatives, it is a messaging medium par excellence.

However, it is more than mere communication: it is also a medium for

entertainment and information. Moreover, the Internet can be used as a medium

for transactions, for buying and selling. Although all applications have implica-tions for the utilization of an organization’s human resources, this chapter

concentrates on the area likely to impinge closest on most organizations: the

medium of transactions.

The largest growth in transactions using the Internet has been in the area of

transactions between businesses; the so-called business-to-business (B2B)

sector. Since the end of the 1990s when global e-commerce was worth a little

more than $150 billion (The Economist , February 26, 2000), the growth rate

has slowed, but is still continuing strongly. Forrester (www.forrester.com), a

respected research organization in the field, expects this sector to reach $7

trillion or 27% of total U.S. trade by 2006. It is hard to know how seriously to

take such a dramatic prediction, but major growth in this area — despite the

downturn both in the world economy in general and in Internet-related stocks

in particular — seems inevitable.

One particular area of growth in B2B transactions is taking place in old-

economy firms. These companies are involved in transactions within the new

economy in different ways. Firstly, they can invest in and even take over new


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economy companies. Secondly, they can start up their own subsidiaries to

operate within the new economy. Thirdly, they can attempt to incorporate

the new economy into their old-economy organization. It is this third areathat is probably most interesting from the point of view of the utilization of

human resources. This is because old-economy companies, which start up their

own new economy companies, normally run them as separate entities. Clearly

financial reasons play an important part in this decision, but so do organizational

considerations. New economy companies may require a different organiza-

tional structure and culture than the parent company, and hence running new

economy companies as separate entities minimizes any possible cross-con-

tamination from the new to the old or vice versa. However, when old-economy

companies attempt to integrate business-to-business e-commerce into their

existing organization, solving the problems that arise can provide new chal-lenges and opportunities in HRM. It is on this third way of organizing that this

chapter concentrates.

Because this B2B growth area is concentrated in old-economy companies that

are the majority employers, it is likely to have a significant impact on HRM.

Most HR professionals are still concentrated in these medium-sized and large,

old-economy companies, and this is where the HR function is subject to radical

and dramatic change because of the implications of Web-based organizing. The

new economy start-ups, those still around, hardly use the HR function in spite

of the proclaimed importance of their people to their success. This chapter

therefore focuses on the consequences of Web-based B2B transactions in

medium-sized and large, old-economy companies, and discusses the implica-

tions for HRM and HR professionals.

However, before we begin our exploration, we will give an overview of the

striking characteristics that distinguish Web-based transactions from more

traditional transactions. We will then continue with a discussion of the different

ways in which old-economy companies are attempting to integrate elements of

Web-based organizing into their current business and the resultant implications

for HRM. We must remark though that there is a lack of reliable information

about this whole area. Most publications at the time of writing have been basedmore on personal experience than research and tend to focus on the same few

companies that are often not only reorganizing to accommodate the new

Internet economy, but are also intimately involved in selling equipment or

services related to it. This chapter is therefore based on personal experience

of working in the field, interviews with others more experienced than us, and a

review of the available literature sources.


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The Effect of the Internet on

Business Transactions

The Internet is having a major impact on business transactions because of the

different opportunities it offers. A number of significant differences distinguish

transactions using electronic markets from what has gone before. These include

the opportunities for global sourcing and selling, mass-customization, and

networking (Timmers, 1999). By lowering the costs of transactions and

information, technology has reduced market frictions and provided a significant

impetus to the process of broadening world markets (Greenspan, 2000). This

means that considerations about where to locate become secondary, whereas

price competition increases. Internet technologies also allow specificationdesign and pricing online, which again increases price competition. This

facilitates meeting customer needs, often through a network of multiple business

partners able to deliver value more quickly and cheaply direct to the customer.

Experts have argued that transactions using e-commerce come far closer to the

economists’ ideal of perfect competition than transactions using traditional

media, as barriers to entry are lowered, transaction costs are reduced, and

buyers have improved access to information (see Shapiro & Varian, 1999;

Wyckoff, 1997).

There are three main responses to the developments in business-to-business

transactions via the Internet being observed (Wright & Dyer, 2000):

• E-commerce: buying and selling via the Internet;

• Supply chain integration: collaboration throughout the total value chain;

and

• Fully integrated e-business: internal and external integration sharing

real-time information (resulting in ‘bricks-and-clicks’ or ‘clicks-and-

mortar’ hybrid organizations).

Wright and Dyer also identify a fourth derivative, enterprise resource planning

(ERP), however this focuses on developing an intranet for internal integration

within a firm, and less on relationships between businesses. Here we shall focus

on the three B2B outcomes identified.

Firstly, the Internet is seen as an extension of normal market channels for buying

and selling. In this approach, companies primarily use the Internet in order to


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improve the quality and speed of customer service, and as a medium to buy and

sell more products or services cheaper. Thus for every business, the Internet

— at the very least — offers opportunities for reducing operating cost levelsand enhancing service levels (Venkatraman, 2000).

The second way in which old-economy companies attempt to integrate the new

economy is by using the Internet to expand and improve their current collabo-

rative relationships among their key suppliers; the Internet can encourage close

integration between the partners through total value chain integration (Timmers,

1999), establishing virtual marketplaces within the supply chain primarily to

reduce transaction costs.

Finally, the third approach, which is much more fundamental, requires that old-

economy organizations totally rethink their business models before deciding on

their e-commerce and supply chain strategies. This approach requires manage-

ment to re-examine why customers buy from them, look at all stages in the

processes involved, and consider how the Internet could impact each stage of

the processes. Then, if necessary, new business models can be developed to

fully integrate the new economy principles. This implies organizational revolu-

tion.

Alongside this rise in e-business, there is a lack of reliable data on the people

issues arising from a move from a traditional brick-and-mortar business model

to an e-business model. The changes however imply a need to learn to use these

new technologies and to embrace a climate of constant change. Some specificoutcomes might be a need to adopt more aggressive recruitment campaigns to

attract the necessary technical staff when competing against the dynamic

dot.coms. There may also be a resultant culture clash when the new ‘techies’

join the company on high salaries, compared with existing non-technical staff,

which might lead to resentment and perceived unfair treatment.

In a review of the potential implications, Wright and Dyer (2000) have

suggested six broad HRM principles in response to the issues e-business is

raising:

1. The company should promote individual autonomy and personal account-

ability at all levels of the organization through the process of work design,

to make the company more flexible to change.

2. Shared organizational vision and values should be reinforced through

HRM policies and practices, particularly recruitment and training, to

maintain a sense of community in times of change.


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3. The company needs to ensure employees understand the business strat-

egy and context so that they can see where they fit into the whole. This can

be achieved through communication, participation, training, and perfor-mance-linked reward in particular.

4. There is a need to develop a learning organization, sharing the responsi-

bility jointly between employees and the company to keep competency

levels at the leading edge.

5. It is also important to develop a sense of belonging, trust, support, and

commitment throughout the organization. This entails arranging appropri-

ate induction, providing access to information, investing in employee

development, being a responsible employer with regard to work-life

balance, and being honest regarding job security.

6. And ultimately, rewards must be provided which are perceived to be

commensurate with the effort applied.

These implications could be argued to apply across multiple types of organiza-

tion; however, we explore these implications in detail in the context of the e-

business model throughout this chapter. Each of the three responses to the

Internet economy is now explored in turn, shedding further light on the major

changes taking place in both HRM practices and within the HR department.

Companies Buying and

Selling on the Internet

The first major developments in this area started in the mid-1990s and saw

major U.S. firms such as Wal-Mart and General Electric moving to buying and

selling online to cut costs and speed supplies. The aims of cutting paperwork

and time may have been simple, but the results were impressive (see Box 1).

The initial rapid spread of business exchanges was followed by a realization by

many large customers that if they combined their individual buying power with

that of their large competitors into a separate buying and selling exchange, then

this might have a major effect on their procurement costs. For example, General

Motors, Ford, Daimler Chrysler, and Renault-Nissan merged their individual

exchanges in 2000 to create Covisint, a virtual marketplace for the automotive


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industry. Later they were also joined by PSA Peugeot Citroen. In 2001,

Covisint handled procurement transactions worth more than $45 billion ( Fi-

nancial Times, November 13, 2001), and in 2003, the Covisint user baseexpanded by 178% (www.covisint.com). Covisint provides the global motor

industry with a common connection to its suppliers and customers based on

common business processes, reducing costs, increasing efficiency, enhancing

quality, and improving time-to-market.

Large companies can use the Internet for buying and selling to put themselves

at the center of new e-business eco-systems that transform their way of doing

business and their way of organizing. The interconnectivity demanded exter-

nally influences how the company is organized. For example, order-taking

systems have to be made very customer-friendly and closely linked with

planning and production systems in order to ensure just-in-time delivery andzero stocks. Hence we might expect the marketing function to increase in status

and power at the expense of the sales function, as customer relationships

become more important and more and more direct sales are taken over by the

Internet.

Procurement will also have to be online to ensure adequate supplies. Closer

links within the whole administrative system will also be required to ensure that,

as far as possible, the whole paper chain from order to invoice to payment

should proceed automatically. Finally, logistics and distribution must also be

linked to the system, as delivery windows agreed with customers have to bemet. These functions are thus also likely to gain in status and importance. But

what of the impact on the HR function?

GE has built up a trading process network, which is a Web-based link to suppliers so that they can

bid for GE components’ contracts. This global supplier network links 1,500 corporate buyers and

around 16,000 suppliers. According to information issued by GE in 2000, the system cut

procurement cycles in half, processing costs by one-third and the cost of goods purchased by between five and 50% (The Economist , March 4, 2000). Every GE company now has targets for e-

auctioning of around 60-70% of total spending, and this e-procurement model is applied not only

to indirect spending, but to many services as well ( Financial Times, December 5, 2001). Indeed

GE’s CEO, Jeff Imelt, has been reported as going even further in suggesting that his managers

should either digitalize or outsource all parts of their business that do not touch the customer

directly (Useem & Watson, 2001).

Box 1. GE saves time and costs by using the Internet


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Implications for HRM

The implications for the HR function of large companies doing business throughe-hubs have not been as immediate as those observed for the marketing and

distribution functions discussed earlier, but they are becoming clearer. Many

Western-economy companies need to lower their costs as global competition

increases from developing countries with lower operating costs. In order to

avoid being classified as just another commodity supplier, they also have to

endeavor to add unique value by being able to offer exceptional levels of

customer service and customized products and services.

Companies aiming to reduce costs, while at the same time increasing flexibility

and speed of response to customer wishes, are forced to adopt innovative practices. These new practices fall under three broad headings:

• the introduction of flexible working practices to meet flexible production

requirements;

• an agile production approach, focusing on minimizing buffers and concen-

trating on a just-in-time supply approach; and

• globalization of the marketplace and workforce.

An overview of each approach is presented next.

Flexible Working Practices

Introducing flexibility to the working practices of a company can have multiple

meanings in different contexts (Brewster et al. , 2001). Cost savings can be

achieved by matching working hours as closely as possible to fluctuations in

supply and demand. This can also improve productivity by enabling people to

work the hours that suit them, often leading to lower levels of absence among

employees. Long-term uncertainty for the company can be reduced by focusing

on non-permanent employment contracts and external resourcing arrange-

ments. Companies are also offering new patterns of working to tap into areas

of the labor market previously ignored where essential skills and manpower are

available. Further flexibility can be achieved by renegotiating the range of tasks

existing employees are expected to undertake. Finally, in order to reduce

uncertainty for the company, flexible forms of financial reward linking individual


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and company performance enable salary costs to represent financial perfor-

mance more closely.

The extent to which each of these practices is adopted relates largely to theorganizational context: the company’s strategic choices, the norms within the

sector, and the national level regulations and standards in force. For example,

decisions regarding the introduction of such schemes as profit sharing or share

options are most commonly closely related to the tax laws within a country.

There may also be regulations through employment law or standards across a

sector regarding the type of contracts a company is able to issue.

A final warning regarding the introduction of more flexible working practices

involves the notion of a company creating a core and periphery workforce

(Atkinson & Meager, 1986). The core consists of those employees on

traditional permanent contracts, while all those on non-standard contracts

make up the periphery. Extra attention needs to be paid on how the company

manages this form of organization: how it communicates with employees who

are not present throughout the week, how it motivates periphery employees so

that they do not feel like second-class employees, and how people working

non-standard hours are actually supervised. All these challenges raise new

issues for the HR department to master.

Agile Production Techniques

Cost and quality issues have dominated production manufacturing environ-

ments throughout the last decade, resulting in the idea of lean manufacturing

emanating from practices in place in the Japanese motor industry in particular

(McCurry & McIvor, 2002). Characteristics of lean manufacturing include

integrated production flow, low inventory, quality enhancement, flexible work-

ing practices, a problem-solving focus, and flat organization structures. These

have led to linked HRM practices in the form of high performance work

systems (HPWSs). These high performance or high involvement HRM systems

focus on four core practices: employee development, flexible job design interms of employee participation and teamwork, incentive-based payment

systems, and investment in recruitment and selection (Boselie & Dietz, 2003).

Team-based organizational change programs (such as 6 Sigma, Quality Circles,

and TQM) have also been associated with this approach to HRM. These

programs emphasize process management, customer focus, organizational

learning, and self-managed teams (Wood, 1999). However, the literature is not


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alone could add up to several hundred million dollars per year (The Economist ,

August 26, 2000).

If an organization is to be successful in becoming a member of a virtual supply

chain community, it will have to maintain the high performance work systems

we mentioned in the last section, while continuing to develop in other areas as

well. There needs to be a balance between the rationality and order resultingfrom the HPWS techniques, and a willingness to constantly consider change

and implement innovation quickly as in the agile production model discussed

earlier. This balance is difficult for any organization to achieve, yet it is not

impossible. For example, the definitive study of why Toyota was able to

achieve such a dominant position in the world automotive market concluded

that this balance was the major reason for its success (Fujimoto, 1999).

It is obvious that such fundamental change requires innovation not just in a firm’s

own systems, but also in its whole supply chain. Web-based links need to be

formed between both internal departments and suppliers and customers rightthrough the chain. It also means integrating the whole value chain into virtual

business communities (Timmers, 1999), virtual value chains (Rayport &

Sviolka, 1995), or value nets (Bovet & Martha, 2000) depending on the

preferred terminology.

Close and trusting collaboration between partners is essential in such a chain.

No business involved can afford to have even one weak link in the chain

Box 2. Cisco Systems’ total value chain integration

Cisco Systems is a classic example of a manufacturer using a total value supply chain network.

Cisco develops and manufactures high performance networking products that link geographically

dispersed local and wide area networks. The company has created an elaborate web of partners on

the Internet, including manufacturers, assemblers, distributors, original equipment manufacturer

strategic partners, and sales channels. Products are conceived, designed, developed, manufactured,

sold, serviced, and enhanced from multiple locations all on the Web. Cisco transfers its strategic

knowledge (customer requirements and company strategy) and product knowledge assets to its

strategic partners. In return Cisco receives system design input and planning knowledge from these

partners. With Cisco’s active encouragement, participants lubricate the system by freely

exchanging knowledge and opinions. This community enables dramatically lower product cycle

times, reduced costs, and fast innovation. Cisco’s value network is drenched in intangible valueexchanges that create its strategic advantage in the market (Tapscott, 1999).


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because, increasingly, a firm’s competitiveness does not depend on its own

resources and capabilities alone, but is decided through its ability to mobilize

its whole value chain. Hence, it is value chains rather than businesses that arecompeting against each other (Cool, 1997). In a virtual supply chain commu-

nity, the relationship between partners will be one of collaboration, based on

long-term relationships and joint involvement in new product development.

Such value chain collaboration is critically dependent on affiliation, loyalty, and

trust (Van Alstyne, 1997).

The ability to consider change and innovation in the context of a virtual supply

chain is thus complex. It requires the development and maintenance of a

climate of trust between network partners, both internally and externally.

Learning both at individual and at organizational levels will also have to be of

a high order in order to facilitate the necessary continuous improvement andinnovation. Developing and supporting both trust relationships and a learning

climate simultaneously thus appears to be the crucial competence required by

companies.

The academic literature on trust among individuals has a distinguished history

and, recently, the high incidence of mergers, alliances, joint ventures, and

outsourcing interesting work has also been carried out at the organizational

level (e.g., Blois, 1999; Child & Faulkner, 1998).

A major reason why trust is important in the context of a virtual supply chain

is as a possible governing device. Traditionally the most popular governingdevice in relations between customer and supplier has been the legal contract.

Unfortunately, legal contracts rely on being able to prescribe what should

happen in all possible eventualities for their effectiveness. Thus, the more

unpredictable the situation, the less effective any legal contract will be

(Nooteboom, 2000). Virtual supply chains, in particular, operate within

unpredictable dynamic situations. If a partner relies on methods of governance

other than legal formality, this sends a clear message to the other partner;

therefore, to trust someone or something is to accept risk, vulnerability, and

uncertainty. It is not a state to be entered into lightly. Nevertheless, a

relationship of trust can be economically sensible because the opposite — mistrust — may, in fact, add to the transaction costs involved in a relationship.

There are important distinctions in organizational trust between technical or

competence trust, and intentional or motivational trust (Nooteboom, 1996).

These distinctions are somewhat similar to those made by McAllister (1995)

who, at the individual level, has split trust into cognition-based and affect-based


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trust. Cognition-based trust is related to confidence in the partners’ technical

work-related abilities, whereas affect-based trust is primarily dependent upon

a personal emotional relationship. Partners will seek to heighten both kinds of trust so that the relative value of the partnership is raised, thus increasing the

switching costs that would be incurred by moving to a different partner.

Cognition-based trust affects individuals at a transactional level. If a partner

proves incapable of doing the job, delivering as promised on time, quality, and

price, then a mistake has been made in assessing their technical capacity;

however, there has been no personal betrayal. Affect-based trust on the other

hand involves individuals personally. They feel a sense of personal loss if they

can no longer work together. If this affect-based trust is broken, then the deep

emotion of betrayal is felt. Affect-based trust thus takes a long time to develop

but is more resilient. As Braunschvig (1998) has pointed out, alliances betweenindividuals and groups develop more intensely in an unstructured situation, such

as a virtual supply network, than in a clear command and control environment.

Implications for HRM

This new emphasis on trust relationships between organizations needs similar

trust relations to be encouraged among managers within organizations. As the

organization becomes less hierarchical and structured, so the manager’s role

changes. As a consequence of having to trust people to perform to the best of

their abilities, managers have to become facilitators, creating the conditions

under which employees can and want to give optimum performance. This

clearly poses a major challenge for HR to support managers in these new roles.

Given our earlier discussion of creating a more flexible workforce to meet

production and service requirements, the issue of trust is particularly pertinent,

as this is becoming the key mechanism (rather than control) required for

managing a workforce that is more dispersed in both location and time (Handy,

1995).

In attempting to develop a climate of trust, certain bundles of HRM practicescan be adopted to support such an endeavor. For example, Whitener (1997)

emphasizes the issues around the psychological contract between the employee

and employer: alongside explicit contractual obligations such as appropriate

pay and benefits in return for work carried out, there are other developmental

and emotional obligations relating to job security, training and development,

loyalty, commitment, and meeting promises such as overtime or support.


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In addition to creating a learning organization, other HRM practices can also

be useful to encourage a culture of innovation. For example, reward and

performance evaluation systems can be devised to encourage rather than punish risk-taking. Suggestion schemes can also be introduced for individuals

to put forward their ideas on how processes might be improved, regardless of

their position in the company. These activities — in combination with an

environment that encourages knowledge sharing, learning, and development —

can significantly improve a company’s creative talent.

Implications for the HR Department

In practical terms for the HR department, guiding and encouraging knowledgeexchange both within and between organizations can be considered a three-

stage process (Seely Brown & Duguid, 2000). The first stage is to find out

where interesting experience might be available. HR departments have a role

to play in identifying organizations to which their own company can relate,

which have useful experience in facing and overcoming the issues in which they

are interested. So if the corporate aim is to develop and maintain more trusting

relationships with suppliers and customers, HR needs to be aware of other

relevant organizations from whose experience they could learn. The second

stage is then gaining access to this experience through collaborative discus-

sions, and the third stage is deciding if and how the experience can be exploitedto fit the company’s situation. The latter can best be done through setting up

communities of practice, that is, bringing together similar people with similar

interests facing similar problems.

A typical example of how the HR function might operate in this context would

be as follows. The company aim is to switch a portion of its current investment

in R&D to more venture capital type activities; it aims to take stakes in or take

over young start-up companies with innovative ideas and technologies relevant

to the basic business, instead of trying to grow them in house. However, the

success rate of mergers and acquisitions is known to be low, and especiallytroublesome are takeovers where the objective is obtaining technological

expertise (The Economist , August 5, 2000). So the company wants to learn

how to improve its success rate in this important field.

Knowing, for example, that Cisco Systems has been practicing for some time

a highly successful strategy based on growing primarily through acquisitions,

many of which have been small innovative start-ups, and that much of this


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information about the Cisco approach is in the public domain, this would be a

good starting point for HR to explore. For example, Bunnell (2000, pp. 64-76)

outlines the Cisco acquisition process in some detail, showing the importanceof the many different systems used. But no story, however well told, can cover

the whole situation. In order to fill out the total picture, contact needs to be

made between relevant individuals in both companies: the learner and the

example company. Relevant individuals need to be able to talk with their

equivalents, thus forming a community of practice. And it is of course the

development of precisely such communities that has been facilitated by the

growth of the Internet (Seely Brown & Duguid, 2000). The HR department

thus has a powerful role to play in the development of organizational learning.

The moves we have outlined above towards a new balance between innovation,

trust, and learning on the one hand and new forms of discipline and control onthe other will not be easy. They will require a refocusing of role for HR

professionals. HR roles have been widely discussed (see for a current over-

view: Paauwe, 2004), but one of the most well known is Ulrich’s (1997) model

of four roles, namely strategic partner, change agent, administrative expert, and

employee champion. However, these roles are not independent of each other.

For example, both change agency and high-level strategic advice are required

in converting a company from traditional supply chain processes to those

immersed in the virtual supply chain economy. This becomes clear if we think,

for example, about people in positions of power who have achieved their status

through competence and expertise relevant to different aspects of the value

chain. Moving to a virtual chain means that the power structure will have to be

dismantled and rearranged. Therefore, institutionalized systems and extant

political power structures are likely to resist change. We discuss in further detail

the implications of managing this significant change situation for the HR

department in the following section.

Organizational Revolution

The third and final possible reaction of old-economy companies to the growth

of the Internet economy which we will discuss here is for the company to step

back and reassess how the Internet might affect its business. Schwartz (1997)

indeed argues that the major opportunities posed by the Internet economy lie

first in de-constructing the value chain in order subsequently to reassemble it,


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if necessary with new roles and new business actors. Companies are thus being

counseled to rethink the strategic fundamentals of their business.

For example, it is argued that information defines existing supplier relationships(Evans & Wurster, 1997); having a relationship means that two or more

companies in a supply chain have established certain channels of communica-

tion and information. However, the economics of information are changing. The

Internet enables this information to be unbundled from its physical carrier,

hence reaching a wider community very cheaply. This has the potential to

undermine established value chains. Many companies thus need to rethink their

information strategies fundamentally — a process that often results in unravel-

ing vertically integrated value chains.

What a company needs to examine is how transacting its business using the

Internet might help add new forms of value to the company. Rethinking thus

starts with the customer. It involves going right back to the fundamental value

proposition and understanding what motivates end-customers to buy from the

company and not from the competition. Once this is established, all aspects of

the organization must be analyzed, such as the goods or services offered, the

key business processes, the financial and human resources required, the

organizational structures, and the major systems and procedures. These are the

building blocks that can be redesigned, added to, and reconfigured to transform

the value proposition using the new opportunities offered by the Internet.

The need for this radical rethinking of strategy and unraveling of verticallyintegrated value chains is particularly high in distributive networks (Tapscott,

Ticoll, & Lowy, 2000). Distributive networks use mediating technologies to

facilitate exchanges across time and space (Stabell & Fjeldstad, 1998). Hence

they are the key organizations supporting business transactions via the Internet;

they allocate and deliver goods — be it information, objects, money, or other

resources — from providers to users (see Box 3).

In Europe, distributive networks such as power companies, postal and

telecommunications services, and railways used to be government-regulated

monopolies. They reflected a physical capital asset-based mindset — a view

that to deliver value to a customer, the company should own its entire value

chain. In the case of electricity supply, this would incorporate generating

facilities, transmission lines, local distribution networks, and access to end-

customers. Rethinking the strategy by concentrating on the opportunities and

threats posed by transactions using the Internet raises opportunities for

redefining the generation, transmission, and marketing businesses. This process


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is currently underway in a number of countries, with one resultant international

initiative being the setting up of an electronic marketplace for the utilities

industry, Eutilia, similar in nature to that of Covisint in the automotive industry

discussed earlier.

It is clear that business model redefinition can be a radical revolution. Thus,

despite the enthusiasm with which some consultants propagate it, it is a high-

risk strategy, as Enron found out to its cost. However, for some businesses,

doing nothing may mean a higher long-term risk. The key to success for high-

risk strategy such as value proposition redefinition lies in the way the whole process of redefinition and subsequent repositioning of the business is man-

aged. This is likely to be a highly threatening organizational change process,

leaving many managers and employees facing an unpredictable future in

comparison to the relative security to which they were accustomed.

Such redefinition can be a highly threatening exercise for employees, and

particularly senior management. These people may need strong encouragement

before they are willing to undertake such an exercise. For example, in 1999, GE

recruited an estimated 100 external top e-commerce experts to be used as

‘black belts’ or team leaders of a program entitled, “Destroy Your Own

Business” (Floyd, 2002). These teams were set up in every GE business unit

with the objective of redefining how the Internet could be used to annihilate the

unit’s mainstream business. The task proved very difficult. Many units were run

by senior managers who, for years, had successfully run businesses under pre-

Internet conditions. Such individuals often had little understanding of e-

commerce, and had difficulty envisioning any positive impact of the Internet on

their thriving businesses.

Box 3. The transformation of a distributive network: Federal Express

Federal Express started life in 1971 as a transportation company using trucks and roads to deliver

goods. As early as 1979 it was using a centralized computer system to manage people, packages,

vehicles, and weather scenarios in real time. Following a name change to FedEx in 1994, it has since

moved further ahead into the Internet age. In late 1998, FedEx decided that its physical distribution

system of trucks and airplanes was less valuable than its Internet-worked information resources: its

digital capital was gaining value over its physical capital. FedEx decided to focus on value-added

context services like online package tracking and logistics outsourcing and leave the actual driving jobs

to outsourcers; hence, the company began selling its transport network, marshalling a web of truck and

air transporters to handle the physical delivery. In the process, it created a $16 billion transportation

powerhouse (www.fedex.com).


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Box 4. Four roles of HR in the knowledge economy (Lengnick-Hall &

Lengnick-Hall, 2002)

Human Capital Steward

HR can act as a facilitator in partnership with employees with the aim of achieving the highest return

possible on the company’s human capital investments. Human capital goes beyond task-related

knowledge, skills, and abilities to include general life experiences, social skills, values, beliefs, and

attitudes. As such, individuals need to be guided and facilitated rather than controlled and dominated.

The HR department needs to lose the policing or paternalistic role to encourage individual voluntary

contribution. Given human capital’s value to the organization, and that it is both unique and perishable,

appropriate strategies for hiring, training, retaining, and removing need to be adopted, including the

encouragement of innovation and flexibility.

Knowledge Facilitator

The HR department has a role to play in facilitating both knowledge capital (held in explicit and

implicit sources) and knowledge flows. This can be achieved by promoting an understanding and value

of knowledge management, creating knowledge sharing and usage expectations. Other strategies

include schemes for continuous learning and brokering knowledge exchange. An overhaul of existing

appraisal and compensation practices may be required to support the desired knowledge management

behaviors. Furthermore, the HR department needs to encourage the organization to change its behavior

in light of what it learns.

Relationship Builder

The focus here lies on managing relationships between individuals and groups both internal and

external to the organization to enhance social capital across the total value chain. However,

relationships are complex, requiring multiple dimensions to be considered, including: rapport (trust,

respect, empathy), bonding (collaboration), breadth (scope, range of transactions), and affinity (interest,

attraction). Appropriate HRM strategies for building such relationships include cross-functional

teamwork, intra- and inter-organizational communication, inter-unit resource exchange, and inter-firm

learning.

Rapid Deployment Specialist

As firm competitiveness is increasingly dependent on speed, the HR department needs to take

responsibility for the development of flexible human capital resources with an emphasis on

adaptability, tolerance, and capacity to learn. This means creating human capital configurations that can

rapidly be assembled, deployed, and disassembled to meet the needs of fluid work assignments. This

entails the encouragement of appropriate employee attitudes, team behavior, and values that support

flexibility, adaptability, and creativity. Employees must be encouraged to self-organize, and be capable

of working in situations of crisis, stress, and uncertainty. A culture of widespread sharing of

organizational information and team-working is essential to achieve these aims.


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Conclusions

In this brief overview, we have suggested that there are three main ways inwhich old-economy companies are attempting to integrate the new economy as

extensions of their current businesses. These business models are summarized

in turn below, considering the implications for HRM practices and the HR

department. It is emphasized here that this is a new and interesting field in the

HRM literature that has not yet been fully explored empirically. We encourage

others to take up the challenge in this dynamic world to explore further the

tentative conclusions we are reaching here.

The first e-business model treats the Internet as an extension of the normal

marketplace. Companies use it primarily to sell more products or services andto buy cheaper. This will involve many organizations operating primarily

through business-to-business exchanges. The transparency and global reach of

these exchanges will put major pressure on suppliers’ costs and speed and

flexibility of response.

We have suggested that the major accepted way for Western companies to

achieve necessary cost savings and performance increases is to adopt an agile

management approach combined with a flexible, high performance organiza-

tion to gain the maximum advantage from the globalization of the economy. This

implies a clear human capital steward role for the HR function to be highly

cost-efficient in the way in which it operates. In addition to broadening their

portfolio of expertise to cover the implementation of flexible working practices,

high performance work systems, and international HRM practices, HR profes-

sionals need to rethink how they deliver their service to their clients. E-HRM

has been discussed here as a tool for streamlining and improving the scope and

depth of service delivery, hence delivering the required cost savings and quality

improvements demanded of the department.

The second way in which old-economy companies are attempting to integrate

the new economy is by using the Internet to expand and improve collaborative

relationships among their key suppliers. We envisage many business-to- business suppliers becoming members of fully integrated virtual supply chains,

with a need to develop trusting relationships between all partners in the

network, combined with the necessity of constant improvement in performance

and innovation.

In such a situation, what is needed is a combination of the rationality and order

of high performance work systems along with a willingness to constantly


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consider change and, where necessary, to implement innovation quickly. This

balance between strong routines on the one hand, and the freedom to

experiment and innovate on the other, is difficult for any organization to achieve.It requires the development and maintenance of a climate of trust both internally

in the firm and externally between network partners. In addition, learning both

at individual and at organizational levels will have to be of a high order in order

to facilitate the necessary continuous improvement and innovation.

So again the role of the HR department is clear. Not only must they ensure

development and maintenance of a high performing, flexible organization, but

they must also assist in the development of trusting relationships and learning

and innovation. This involves a re-evaluation of the employer-employee

relationship that the company advocates, monitoring employee attitudes and

encouraging and rewarding participation, knowledge sharing, and risk taking tothe benefit of the company. The focus is on the relationship builder and

knowledge facilitator roles of HR professionals in developing a climate of

trust, innovation, and learning.

Finally, as we have suggested, there is also a third way that may be a temporary

state, but is much more fundamental. This approach requires old-economy

organizations to rethink totally their business models before deciding on their

e-commerce strategy. They must re-examine why customers buy from them,

look at all stages in the processes involved, and consider how the Internet could

impact each stage in the processes, and then, if necessary, develop new business models for the required reorganization.

Here, the rapid deployment specialist role for HR is clear, alongside the

knowledge facilitator role. HR professionals must assist in managing the

multiple change processes involved and also help those involved in the process

to gather whatever learning is available as effectively as possible. And satisfying

rather than striving for perfection in daily operations will be the order of the day.

As our overview has pointed out, the uncertainties, problems, and complexities

for many organizations of moving business-to-business transactions onto the

Internet will mean that the pace for many will be slow even if it is steady. To start

with, both Internet-based and non-Internet-based systems are likely to be kept

running in parallel. For example, business-to-business selling in many compa-

nies will exist side-by-side with a more traditional approach. Selling through the

Internet may have major cost advantages, but it does not give much opportunity

for developing personal contacts, nor for the flexibility sometimes needed to

clinch the sale. For example, it is hard to enquire about a customer’s family


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“This could well be the opportunity of last resort for mature economies

challenged by companies from younger, hungrier cultures and countries.”

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